Everyone has been or will be affected by Corona Virus / Covid 19 in some way, shape or form.
Apart from the obvious horrific implications on people’s health resulting in many unnecessary and unexpected deaths, societal changes (will you ever shake hands again?) and vast global job losses, the Corona Virus has had a massive financial impact on the World. No one knows yet just how big the bill will be, but everyone agrees it will be huge. So, most asset classes will be affected. Let’s be realistic, they will be negatively affected. Property prices down, equity portfolios down etc. etc.
I’m sure some clever folk will have taken opportunities as they have presented themselves, resulting in an increase in net worth, but many won’t have.
The purpose of a section 72 life insurance policy is to pay out a guaranteed lump sum of money on the death of the life assured, which has to be used to cover the amount of inheritance tax that their beneficiaries will have to pay to the Revenue Commissioners when the estate is divided. Hence, if the value of your estate is less, it stands to reason that the amount of CAT payable will be lower… Ceteris paribus (My Mum was an Economics teacher). Assuming allowances and rates of tax payable do not change.
If you already have a section 72 insurance policy in place, you may wish to review (downwards) the level of cover that you have. It may be a bit soon for this, as no one knows what you should review it against as the damage has yet to be assessed, but just be aware of it. And when the time comes, contact us here to have a chat about reviewing your options.
Awareness & Clarity…
If you have yet to take out your Section 72 policy, you may be feeling slightly more mortal and pensive at the moment, so this may prompt you to look at putting one in place. However, this is not the right emotional state to be in when organising a policy. But again, be aware of it… assess your options, have a think about things and then set about getting some quotes for your policy. This is what we’re good at. You can organise a quote for your policy by clicking here.